The central bank of the Netherlands, locally known as De Nederlandsche Bank (DNB), slapped Binance with a monetary fine of €3.325 million for operating in the country without registration.
The Dutch bank mandated the registration of all crypto businesses operating within its jurisdiction to register themselves with the regulator. The rules came into effect on May 21, 2020, with the aim to curb the high risks of money laundering
Money Laundering
Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders.
Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Read this Term or terrorist financing.
The Largest Crypto Exchange
Binance, which is the largest global crypto exchange in terms of trading volume, failed to register itself with the Dutch regulator.
The monetary penalty on Binance was slapped on April 25, but the crypto exchange “objected to the fine on June 2, 2022.”
The DNB pointed out that Binance “has a very large number of customers in the Netherlands.” As the exchange is not registered with the regulator, it does not have to report the crypto transactions for which “a large number of unusual transactions may remain out of sight of the investigating authorities.”
According to the regulations, the Dutch regulator can impose a penalty of up to €4 million, with the base amount at €2 million, for registration lapses by crypto companies. The amount is decided based on the seriousness and culpability of the platforms.
However, the regulator slashed the penalty by 5 percent as Binance’s operations are relatively transparent now. The crypto exchange has also submitted a registration application, which is now being assessed.
The penalty came almost a year after the Dutch regulator issued a public warning against Binance for illegally offering crypto services in the country. Several other regulators also issued similar warnings against Binance.
Meanwhile, Binance has now taken a different and is pushing to become a compliant crypto exchange. It has received several regulatory authorizations in recent months, including from the regulators in France, Italy and Spain.
The central bank of the Netherlands, locally known as De Nederlandsche Bank (DNB), slapped Binance with a monetary fine of €3.325 million for operating in the country without registration.
The Dutch bank mandated the registration of all crypto businesses operating within its jurisdiction to register themselves with the regulator. The rules came into effect on May 21, 2020, with the aim to curb the high risks of money laundering
Money Laundering
Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders.
Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Read this Term or terrorist financing.
The Largest Crypto Exchange
Binance, which is the largest global crypto exchange in terms of trading volume, failed to register itself with the Dutch regulator.
The monetary penalty on Binance was slapped on April 25, but the crypto exchange “objected to the fine on June 2, 2022.”
The DNB pointed out that Binance “has a very large number of customers in the Netherlands.” As the exchange is not registered with the regulator, it does not have to report the crypto transactions for which “a large number of unusual transactions may remain out of sight of the investigating authorities.”
According to the regulations, the Dutch regulator can impose a penalty of up to €4 million, with the base amount at €2 million, for registration lapses by crypto companies. The amount is decided based on the seriousness and culpability of the platforms.
However, the regulator slashed the penalty by 5 percent as Binance’s operations are relatively transparent now. The crypto exchange has also submitted a registration application, which is now being assessed.
The penalty came almost a year after the Dutch regulator issued a public warning against Binance for illegally offering crypto services in the country. Several other regulators also issued similar warnings against Binance.
Meanwhile, Binance has now taken a different and is pushing to become a compliant crypto exchange. It has received several regulatory authorizations in recent months, including from the regulators in France, Italy and Spain.
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This text was written byObserveInvestor based mostly in Geneva, Switzerland. Observe me on Twitter @GenevaInvestor for every day macro & investing nuggets. I write about macroeconomics, international traits, and what I consider are...
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